20180924Howard Supplemental Direct.pdf

ldaho Public Utilities Commission
Office of the SecretaryRECEIVED
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Boise, ldaho
ON BETIAJ,E OF AVISTA CORPORATION
DAV]D J. MEYER
VICE PRESIDENT AND CHIEF COUNSEL FOR
REGULATORY & GOVERNMENTAL AFFAIRS
AVTSTA CORPORATTON
P . O. BOX 3'121
1411 EAST MISSION AVENUE
SPOKANE, WASHTNGTON 99220-3727
TELEPHoNE: [phone]
FACSIMILE: [phone]
DAVID. MEYERGAVISTACORP . COM
ON BETIAI.E OE HYDRO ONE LIMITED
ELIZABETH THOMAS, PARTNER
KAR] VANDER STOEP, PARTNER
K&L GATES LLP
925 EOURTH AVENUE, SUfTE 2900
SEATTLE, WA 981014-1158
TELEPHoNE: (206) 623-'7 580
FACSIMILE: [phone]
L] Z . THOMASGKLGATES . COM
KARI . VANDERSTOEPGKLGATES . COM
BEEORE THE IDATIO PI'BLIC UTII,ITIES COMMISSION
]N THE MATTER OF THE JOINT
APPLICATION OF HYDRO ONE L]M]TED
(ACTING THROUGH ITS INDIRECT
SUBSID]ARY, OLYMPUS EQUITY LLC)
AND
AVISTA CORPORATION
EOR AN ORDER AUTHOR]ZING PROPOSED
TRANSACTTON
CASE NO. AVU_E-71_09
CASE NO. AVU_G-17_05
SUPPLEMENTAL
TESTIMONY
OF
BRUCE F. HOWARD
EOR AVISTA CORPORATION
(ELECTRIC AND NATURAL GAS)
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A. PJ.ease state your name, business address, and
present position with Avista Corporation.
A. My name is Bruce E. Howard. I am employed as the
Senior Director of Environmental- Affairs by Avista
Corporation ("Avista") located at 1411 East Mission Avenue,
Spokane, V[ashington .
A. Please describe your education and business
e:<perience.
A. I recei-ved a Bachelor of Science degree in Natural
Resources from Cornell- University in 1980 and a Master of Arts
from the University of Texas in Geography in 1986. I started
working for Avista j-n 2000 as a Corporate Environmental
Auditor, became the Spokane River License Manager in 2002 and
started my current position in 2008.
A. Wtrat are your duties as Senior Director of
Environmental Affairs of Avista?
A. I am responsible for environmental- compliance,
compliance with Avista's two hydroelectric licenses issued by
the Federal Energy Regulatory Commission ("FERC"), fulfilling
additional- settfement agreements with Tri-bes and agencies,
hydro and public safety, dam safety, environmental policy and
Avista's real- estate matters, including property and rights-
of-way acquisition, property management and water rights.
Additionally, I manage AJT Mining Properties, based in Juneau.
Howard, Supp 1
Avista Corporation
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Please sumrnarize your testimony.
The purpose of my testimony is to introduce the
the Idaho Department of Wateragreement reached between
Resources ("IDWR") and Avista, which ensures that the public
interest, as it relates to Avista's water use pursuant to its
water rights, wj-1l not be adversely affected by the merger,
and meets the requirements of Idaho Code 542-1"701(6) and 561-
328.
A. Are you sponsoring' any exhibits with your
testimony?
11 A. Yes. I am sponsoring
\2 which is a l-etter from the Idaho
Exhibit No. l.4, Schedule t,
Department of Water Rights
13 (the "fDWR") addressed to the fdaho Public Utilitj-es
74 Commission (the *IPUC") and the agreement between IDWR and
15 Avista.
T6 9. Before discussingr
Avista and
the specifics of the agreement
IDWR,pJ.ease provide a brief
the agreement.18 history of events that which J.ed to
19 A. Certainly. On July 9, 2018, the IDWR intervened in
20 Case No. AVU-E-17-09 and AVU-G-17-05, the Joint Application
2L for an Order Authorizing Proposed Transaction, pursuant to
22 ldaho Code 561-328 and 542-1101(6). Idaho Code 542-1,701(6)
23 provides, in relevant part:
I
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I1 reached between
(6) (a)
public
Any authorization or order of
util-ities commission, under the
the Idaho
provis j-ons
Howard, Supp 2
Avista Corporation
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of section 6l-328, Idaho Code, approving the sa1e,
assignment or transfer of hydropower water rights
used in the generation of electric power shal-l- bej-ssued only upon such conditions as the director of
the department of water resources shal-I require as
necessary to prevent any change in use of water
under the water rights held for hydropower purposes
that would cause injury to any water rights
existing on the date of the sale, assignment or
transfer. Any such conditions shal-1 ensure that the
public interest, as it pertains to the use of water
under the hydropower water rights, will not be
adversel-y affected. Conditions, if any, imposed by
the director shall be subject to review under
section 42-11 0lA(4), Idaho Code.
Idaho Code S61-328 provides, in relevant part:
The commission shall include in any authorization
or order the conditions required by the director
of the department of water resources under section
42-L101(6), Idaho Code. The commission may attach
to its authorization and order such other terms
and conditions as in its judgment the public
convenience and necessity may require.
)1 As described in a Ietter to the IPUC written by Gary
Exhibit28 Spackman, Director of the IDVIR, and attached here as
29 No. 14, Schedul-e 7, IDWR's immediate concern was that the
30 merger "wou1d disrupt the ongoing discussions with Avj-sta's
31 water right claims in the Coeur d' Alene-Spokane River Basin
32 Adjudication ("CSRBA") claim and might impede or prevent the
33 resolution of the issues. " In addition, IDWR was al-so
34 concerned the merger could possibly "result in the change in
35 the use of water authori-zed by Avista's hydropower water
36 rights. "
Howard, Supp 3
Avista Corporation
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Soon after IDWR' s intervention, I began discussions with
Dj-rector Spackman, his staff and representatives of the Idaho
Attorney General's office representing IDUIR. Over a series
of dj-scussions durj-ng the following several weeks, we reached
a common understanding of interests. Primarily, these were
to affirm Avista's ongoing operations of the Post Fa1ls dam
as reflected in the Spokane River FERC l-icense and to resolve
IDWR' s subordination concerns.
A. Ilhat are the ter:ms of the Agrreement reached between
Avista and IDI|R?
A. Specifically, IDWR and Avista have reached an
The use of water confirmed in this right shal-1 bejunior and subordinate to permits, Iicenses, or
decrees for all uses within the State of Idaho with
a priori-ty date of , or earlier than, JuIy 25, 201,8,
diverted upstream from all three points of
diversion for this right.
The use of water confirmed in this right shall- bejunior and subordj-nate to permits, licenses, or
decrees for all- uses, except for permits, licenses,
or decrees for irrigation storage or power
purposes, within the State of Idaho with a priority
date later than July 25, 2078, diverted upstream
from all three points of diversion for this right.
Howard, Supp 4
Avista Corporation
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72 agreement regardj-ng
consistent with the
subordination of Avista's water rights
13 historical operations at Post Fal-Is dam
14 IDWR and Avista have agreed that Avistars water right claim
15 nos. 95-4518, 95-9115, and 95-9119 shal-I be recommended in
1,6 the CSRBA with the following subordination language:
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The use of water confirmed in this right shall- not
be subordinate to permits, license, or decrees
within the State of Idaho diverted downstream from
al-l three points of diversion for this right.
A. Does IDIIR believe that the proposed transaction
adversely affectg the pubJ.ic interest?
A. No. As stated by IDVIR in its Ietter to the IPUC
dated August 10, 20L8, "The agreement ensures that the public
interest, as it relates to Avista's water use pursuant to its
water rights, will not be adversely affected by the proposed
transaction between Avista and Hydro One. "
A. Does this conclude your pre-fiJ.ed, direct
testimony?
A. Yes, it does.
Howard, Supp 5
Avista Corporation
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